It depends on the person if the Kindle is worth the price. It would probably be worth it for me because I actually like to read, unlike many people I know. I read fast as well, so I go through books pretty quickly. Having something like the Kindle where you have all of your books in one nifty little gadget would be very useful for me. However, for most people that don't read as often as I do, I think they can deal with carrying the book around, and not spend $350 just to carry around something thinner.
The Kindle could really revolutionize education because I have heard some parents complaining about the amount of books that their children are carrying on their back, and they are concerned that they might end up having back problems. There is a possibility that you could put all of the school textbooks on the Kindle, and then you won't even need a backpack except to put your homework in. Also, school textbooks are very expensive, some being close to $100, if not more. With all of the textbooks that students get every year, having a $350 device to make all your books weightless is better than carrying around $500 or $600 worth of books all over the place. Also, you can't lose any of your books, so you won't have to pay for them, unless you lose the Kindle, of course. However, I highly doubt that. There also might be questions about how other kids in school might want to steal them. Not if everybody has one, they won't.
The prime audience for the Kindle is basically anybody that loves to read. Amazon doesn't expect somebody to buy it just so they can read a couple of books. They expect people to buy it so they can purchase many different books, and then keep reading them, and then buy some more books when they get bored with the old ones. For these people that read tons of books all the time, the Kindle is a great idea, and that is really the main audience for the Kindle.
Now, I do read a lot. I read whenever I have spare time or when people are being real d-bags on Xbox Live. However, I don't read enough that I feel I would need one.